CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English
Country • United States
    Entity • The products and services listed on this website are not available to US residents.
    English العَرَبِيَّة Bahasa Indonesia Български Čeština Dansk Deutsch Eesti ελληνικά Español Français Hrvatski Italiano Latviešu Lietuvių Magyar Nederlands Polski Português Română Русский Slovenčina Slovenščina Suomi Svenska Tiếng Việt ไทย 简体中文 繁體中文

    USD/CAD technical analysis: bearish pattern confirmed

    By Nathan Batchelor

    15:38, 7 October 2020

    USD/CAD technical analysis

    The US dollar has fallen below 1.3300 against the Canadian dollar due to a rebound in oil prices and increased demand for commodity-related currencies.

    USD/CAD analysis shows that a bearish head-and-shoulders pattern is warning of a potential decline towards the 1.3100 support area.

    USD/CAD medium-term price trend

    The US dollar has given back a significant portion of its recent gains against the Canadian dollar, following multiple technical rejections from the 1.3400 resistance zone.

    USD/CAD technical analysis over the medium term highlights the 1.3100 support area as a potential bearish target below 1.3300.

    USD/CAD technical analysis

    Bollinger Band analysis on the daily time frame shows that 1.3100 is a major target if weakness persists below the 20-period simple average around the 1.3260 level. Multiple daily price closes below 1.3260 is likely to see the USD/CAD pair testing towards the lower time Bollinger Band, around the 1.3100 area. 

    If bulls gain traction above 1.3260, then a recovery towards the 1.3320 or 1.3350 levels remains possible. The upper Bollinger Band on the daily time frame is located around 1.3430.

    What is your sentiment on EA?

    127.18
    Bullish
    or
    Bearish
    Vote to see Traders sentiment!

    BTC/USD

    26,518.90 Price
    -0.530% 1D Chg, %
    Long position overnight fee -0.0616%
    Short position overnight fee 0.0137%
    Overnight fee time 21:00 (UTC)
    Spread 60.00

    Oil - Crude

    70.98 Price
    -0.110% 1D Chg, %
    Long position overnight fee -0.0153%
    Short position overnight fee -0.0066%
    Overnight fee time 21:00 (UTC)
    Spread 0.03

    XRP/USD

    0.53 Price
    -0.330% 1D Chg, %
    Long position overnight fee -0.0753%
    Short position overnight fee 0.0069%
    Overnight fee time 21:00 (UTC)
    Spread 0.00451

    US100

    14,472.10 Price
    -0.190% 1D Chg, %
    Long position overnight fee -0.0255%
    Short position overnight fee 0.0032%
    Overnight fee time 21:00 (UTC)
    Spread 1.8

    USD/CAD short-term price trend

    USD/CAD analysis shows that the pair only has a short-term bullish bias while the price trades above the 1.3350 resistance level.

    The four-hour time frame shows that a bearish head-and-shoulders pattern has formed, following last week’s heavy rejection from the 1.3420 area. According to technical analysis, sellers need to move the USD/CAD pair below 1.3260 to activate the bearish reversal pattern.

    USD/CAD technical analysis

    Looking more closely at the bearish pattern, the USD/CAD pair could decline towards the 1.3100 area if the pattern is activated.

    Key short-term support for the USD/CAD pair below 1.3260 is located at the 1.3220, 1.3200, and 1.3160 levels.

    USD/CAD technical summary

    USD/CAD analysis shows that the pair could face a major technical sell-off towards 1.3100 if weakness persists below the 1.3260 support area.

    Markets in this article

    USD/CAD
    USD/CAD
    1.33700 USD
    0.00102 +0.080%

    Rate this article

    The difference between trading assets and CFDs
    The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
    You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
    CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
    CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
    Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

    Still looking for a broker you can trust?

    Join the 535.000+ traders worldwide that chose to trade with Capital.com

    1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading